UPDATED DIFFERENCES IN UK GOVERNMENT FUNDING BETWEEN THE NATIONS OF THE UK

THE UPDATED DIFFERENCES IN UK GOVERNMENT FUNDING BETWEEN THE NATIONS OF THE UK

Back in 2009 the cross-bench independent House of Lords Committee enquiring into the Barnett Formula funding allocation system reported that England was subsidising Scotland, Wales and Northern Ireland to the tune of £49 billion a year.

Here is a link to that report >>> The Barnett Formula Report with Evidence published 17 July 2009

Given the years that have passed since I think it is worth reviewing what public spending is now in the 3 different Nations and in the Province of the United Kingdom. Here are the figures:-

THE PROVINCE OF NORTHERN IRELAND

Population 1.9 million

Public spending per head £14,018 (approx. £14,263 after deal)

Social security 43 per cent: local politicians effectively refused to approve benefit cuts in 2015 and received a £585 million package to soften the blow over four years

Health 19 per cent: funding cuts for GPs have forced some frontline services to be withdrawn and over 6,500 patients waited over 12 hours in A&E last year

Education 13 per cent: Northern Irish pupils are the highest performing in Europe at primary level for maths but a third of GCSE entrants do not achieve five A*-C grades

Public sector workers 25.2 per cent

Private sector workers 74.8 per cent

THE NATION OF ENGLAND

Population 55 million

Public spending per head £11,297

Social security 45 per cent: cuts to benefits have failed to offset the spiralling cost of pensions, which under the DUP deal will still be protected by the triple lock

Health 24 per cent: the Red Cross warned in January that NHS England faced a “humanitarian crisis” amid chronic bed and staff shortages and long waits for care

Education 14 per cent: Many schools are facing real-terms budget cuts under the government’s new funding formula and last year the number of A*-C grades at GCSE saw its sharpest decline since 1998

Public sector workers 17 per cent

Private sector workers 83 per cent

THE NATION OF SCOTLAND

Population 5.4 million

Public spending per head £13,054

Social security 41 per cent: legislation to give the Scottish government control over 11 benefits has been introduced in Holyrood, which the SNP hopes will ease Westminster cuts

Health 21 per cent: only 5 per cent of A&E patients wait more than four hours despite a staffing shortfall and £100 million bill for locum doctors

Education 13 per cent: literacy and numeracy rates have declined or flatlined since 2012 but fewer pupils are leaving school with no qualifications

Public sector workers 21 per cent

Private sector workers 79 per cent

THE NATION OF WALES

Population 3.1 million

Public spending per head £12,531

Social security 46 per cent: Wales’s population is the most deprived in the UK

Health 21 per cent: the Welsh NHS has repeatedly missed targets despite high investment and is suffering from a shortage of full-time nurses

Education 13 per cent: Welsh students score lowest in the UK for science, reading and maths and Carwyn Jones, the first minister, says that the country’s schools are “crumbling”

Public sector workers 20.8 per cent

Private sector workers 79.2 per cent

These figures do clearly show the effect of England’s subsidy to Scotland, Wales and Northern Ireland. They have more public sector spending on every man, woman and child and they also have a higher level of State employment. All of that is dependent upon the English taxpayer.

It should also be noted that these figures do not include capital spending and that is split in the same sort of way which explains why Scottish, Welsh and Northern Irish politicians are so keen on HS2, since as a result of that money being spent in England, they will get extra windfalls of tens of billions of pounds of English taxpayers’ money!

So far as Ulster is concerned, Theresa May’s DUP deal is the latest subsidy windfall for a Province long reliant on the English taxpayer.

As the Times recently put it:-

“The £1.5 billion price tag for the DUP’s confidence and supply deal — equivalent to an extra £530 for every resident of Northern Ireland — has caused raised eyebrows at Westminster and across the rest of the UK.

But in one respect the windfall is nothing new: The Province of Northern Ireland has long received the most generous funding of any region.

Despite its population of just 1.9 million, public spending per person is higher in the province than anywhere else in the UK: £14,042, according to the Office for National Statistics.

Almost a third (27.4 per cent) of the Northern Irish workforce is employed by the public sector, compared to just 17 per cent across the UK as a whole. Tuition fees remain heavily subsidised and prescriptions are free, as is domestic water. Unlike the other devolved administrations, Northern Ireland runs its own social security system but the money flows directly from the Treasury.

This high public spending and low tax revenues means Stormont’s budget deficit — £9.6 billion in 2014 — is equal to a third of Northern Ireland’s total economic output.

Though that figure is vastly higher than most other developed economies, Northern Ireland defies easy comparison for one very obvious reason: “the Troubles”.

As DUP chief whip Sir Jeffrey Donaldson pointed out last week, decades of conflict have posed huge structural challenges for its economy. Resolving the Troubles has in practice meant the Exchequer alone footing the bill in the absence of significant inward investment from the private sector.

Keen to preserve the delicate constitutional settlement at Stormont, Westminster effectively allowed local politicians to refuse to implement the worst cuts in the coalition years. Not for nothing did the Northern Irish historian John Bew say: “The only thing that unites Northern Ireland’s parties is the way they hold out their hands for money. It’s the SNP on crack.”

Though it is hoped that a planned reduction in Northern Ireland’s corporation tax rate to 12.5 per cent next year – in line with the Republic - will help rectify the imbalance in public and private spending, the DUP deal means a long history of state subsidy will continue.”